The commercial real estate lending landscape in the final weeks of 2020 has “vastly improved” compared to the onset of the pandemic, Marcus & Millichap says in a special report. However, for some lenders the market has tilted toward multifamily and industrial, while lending for office and retail has become more selective.

“Assumptions surrounding operating expenses, vacancies, market concession rates and supply trends are being closely examined by lenders, leading some to shift their focus to more pandemic-resilient investments,” according to Marcus & Millichap. “Apartments and industrial properties have been able to draw greater interest with banks and non-agency lenders remaining active originators, most often funding five- to seven-year loans with rates in the upper-2% to mid-3% range.”

The report notes that evolving e-commerce trends, challenges in the single-family home market and limited capital expenditure requirements have helped to ensure financing remains available at favorable terms for both asset classes.